at 19:32 on February 6, 2009, EDT.
By Ryan Nakashima, THE ASSOCIATED PRESS

LOS ANGELES - A proposed merger of concert promoter Live Nation Inc. and ticketing giant Ticketmaster Entertainment Inc. is expected to be announced within days, but antitrust concerns could delay its completion.

Board members for at least one of the companies were meeting Friday, and the announcement of the merger of equals was being planned for Monday morning, according to a person familiar with the situation.

The person spoke to The Associated Press on condition of anonymity because he was not authorized to speak publicly about the matter.

The merger negotiations were reported earlier by the Wall Street Journal.

The deal would match the world's dominant ticket seller, Ticketmaster, with Live Nation, which was once its biggest client. Live Nation is the world's No. 1 concert promoter, owns 140-plus venues and has multiyear comprehensive rights deals covering the tours of Madonna, Jay-Z, U2, Nickelback and Shakira.

Live Nation ended a long-term contract to sell its concert tickets through Ticketmaster last year, and launched its own ticketing service for its venues in January. That threatened to siphon at least 15 per cent of Ticketmaster's revenue and had set the two companies up for a head-to-head fight to win ticketing contracts.

A merger would quell that fight - which could raise the ire of regulators, antitrust experts said.

"Live Nation became an important rival to Ticketmaster," said Marc Schildkraut, a Washington-based antitrust lawyer and former assistant director at the Federal Trade Commission's Bureau of Competition. "Ticketmaster turns around and says, 'Oops, let's buy Live Nation.' That could be a concern for antitrust authorities."

Because both companies are large - with market capitalizations of around US$400 million - they are required to submit a notice to the Federal Trade Commission and Justice Department for review of antitrust issues.

That review could take months - or even longer than a year - particularly in light of previous Justice Department investigations into allegations that Ticketmaster behaved like a monopoly.

In 1994, Pearl Jam complained to the U.S. government that Ticketmaster refused to agree to low concert ticket prices and fees, and that the grunge band couldn't organize a tour without Ticketmaster's co-operation. The case was dismissed a year later. Attorney General Janet Reno said then that new enterprises were entering the ticketing business.

Today, Ticketmaster is still the world's main force in ticketing.

It sold 141 million tickets in 2007. Aside from concerts, theatre shows, and family events, it has deals with the NFL, NBA and NHL and the Premier League of U.K. football. It sells tickets for more than 80 per cent of the major arenas and stadiums in the U.S., according concert tracking firm Pollstar.

Although ticket resale sites have gained in popularity, such as eBay Inc.'s StubHub or RazorGator.com, they rely for their supply on ticket brokers or consumers who bought tickets mainly from Ticketmaster first and are reselling them at a profit.

Ticketmaster also recently got in trouble when it redirected Bruce Springsteen fans from its regular website to its reselling subsidiary, TicketsNow, which offered more expensive seats above face value, even though face-value tickets were still available. It has since apologized, but not before New Jersey's attorney general launched an investigation, and The Boss declared he was "furious."

"The one thing that would make the current ticket situation even worse for the fan than it is now would be Ticketmaster and Live Nation coming up with a single system, thereby returning us to a near-monopoly situation in music ticketing," Springsteen said on his website.

The companies plan to argue that the very technological advancements that allowed Live Nation to launch its own ticketing platform could allow other companies to do so as well. Live Nation's ticketing system is run by CTS Eventim AG, a German company that competes with Ticketmaster overseas and is the market leader in Europe.

AEG Live, a unit of the Anshutz Co. and the owner of the O2 Arena in London and Staples Center in Los Angeles, is also examining whether to sell its own tickets when its agreement with Ticketmaster for about 130 venues runs out in mid-2012.

One way that a Live Nation-Ticketmaster merger could benefit fans is that it would stop two giant players from competing with each other for a piece of concert tours. That battle over artists' tours - one of the last healthy segments of the music business - had bid up the amount that artists and their staff have been able to command from concert ticket sales.

Such competition prompted Live Nation to pay $120 million for an all-encompassing "360" rights deal with Madonna for 10 years, and $150 million for a similar deal with Jay-Z.

Now, perhaps if Ticketmaster and Live Nation merge, they could generate what Boston University professor Keith Hylton described as a form of reverse monopoly power: A single buyer can force multiple sellers, in this case artists, to reduce their fees, potentially driving down ticket prices.

Despite Ticketmaster's dominance in primary ticket sales, it has not been able to set higher ticket prices with impunity.

Even though North American concert ticket prices rose eight per cent last year on average to US$67.33, according to Pollstar, many seats at less popular acts are still going empty.

Live Nation chief executive Michael Rapino told the AP last month that his company intended to improve that process. One of Live Nation's ideas was to raise prices on premium seats while lowering those in the back of the house.

"If we are smarter, and better understand how to sell five per cent more tickets, instead of having dead inventory at midnight - even if you spent a dollar to get in - that's worth more than it being empty," he said.


I hope everyone realizes that this merger, is going to lead and is already causing HUGE ticket tack-on service charges. Some artists have commented that tack on prices have doubled, some ranging from 15-25dollars per ticket. In fact i noticed that Katy Perry was charging $18 for a show and the tack on charge was 12 dollars, how crazy is that shit where the service is more than the damn ticket.
©The Canadian Press, 2009